House prices edging downwards

"There is, nonetheless, evidence of a slight deterioration in the trend recently with prices in the three months to September 0.5% lower than in the previous quarter.

"The average price fell by 0.4% in September; the third successive monthly decline.

"The generally weak economic climate remains a significant constraint on housing demand. The relatively low level of mortgage payments in relation to income, however, continues to provide support for house prices. We expect house prices to be broadly unchanged over the rest of this year and into 2013."

Prices have fallen very slightly over the first nine months of 2012. The average UK house price in September 2012 was 0.3% lower than in December 2011, at £159,486.

In the three months to September, prices were 1.2% lower than in the same period a year earlier. This measure of the annual rate has moved outside the narrow range of 0% to -1% for the first time in seven months.

Activity remains subdued but stable. Home sales have been very stable in recent months, at between 75,000 and 77,000 per month between May and August. Overall, sales in the three months to August were 3% higher than in the same period last year.